A ‘supermajority’ for tax loopholes?

As initiative promoter Tim Eyman crows over I-1053 and its required two-thirds vote in the Legislature to raise taxes, young liberal Internet activists want to turn the tables and target tax breaks.

The Northwest Progressive Institute has filed the “Commonwealth Protection Act”: It would require the same two-thirds “super-majority” to create a tax exemption as Initiative 1053 requires for new taxes.

The measure, filed as an initiative to the people for 2011, would also redefine the tax-raising definition in I-1053: It would provide that repealing a tax exemption is not a tax increase but instead restoring lost state income.
“(I)1053 has been interpreted to mean that any action that causes revenue to go up – even if it is the restoration of lost revenue to the treasury, and not an actual tax increase — requires a two-thirds vote,” said Andrew Villeneuve, Northwest Progressive Institute founder.

“At the same time, it only takes a majority vote to create a new tax exemption with no sunset. That is wrong . . . This would give legislators the ability to pursue a balanced approach to closing future shortfalls.”

Eyman, too, was in Olympia on Monday for a well-attended press conference.
He introduced an initiative identical to I-1053, and vowed to take it to the ballot if legislators make any move to overturn the “super-majority” requirement. Eyman said he
will be back with the same measure in 2012.

The Legislature, last year, came close to imposing a “polluter pays” fee. It would have taxed hazardous substances – notably petroleum – to pay for local projects to clean up pollution in Puget Sound and control storm water runoff.

The state’s major oil refiners, including BP and Tesoro, helped pay for the signature drive that put I-1053 onto the ballot.

Major financial institutions, notably Wells Fargo, Bank of America and JPMorgan Chase, were also a generous contributor to the pro-1053 effort.

The Northwest Progressive Institute tried to fight back with a web site
called “StopGreed.org” detailing the contributions. But heavy spending by corporate interests did not take hold as an issue in last year’s election.

The state created billions in tax breaks a decade ago to successfully woo Boeing to locate its 787 “Dreamliner” assembly plant in Everett. The state’s largest air polluter, a Canadian-owned coal plant in Centralia benefits from tax breaks.

It is not yet clear whether the state’s green, senior and progressive groups will unite behind the Commonwealth Protection Act or any other legislation.

A statewide survey for the American Association of Retired Persons, released Monday, showed some public receptiveness to raising new revenue to close the state’s yawning budget shortfall.

It found 32 percent of those surveyed support balancing the budget by finding new money; 45 percent backed a combination of new money and cutting some services; only 16 percent supported balancing the the budget through cuts alone.